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Cost reduction: identifying the opportunities

Cleverley, W.O.; Cleverley, J.O.

Healthcare Financial Management Journal of the Healthcare Financial Management Association 64(3): 52-59

2010

ISSN/ISBN: 0735-0732
PMID: 20214107
Document Number: 647180
Inpatient and outpatient patient-encounter components provide a far better indicator of relative cost position than measures such as cost per adjusted discharge or cost per adjusted patient day. Cost per encounter can be expressed as the product of three key cost drivers: intensity of services, productivity/efficiency, and resource prices/ salaries and wages. Cost reductions result from actions taken in two primary areas: utilization of services and cost efficiency.

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